35 years of ProcureTech timelines celebrate what vendors built. The failure rate reveals what customers experienced. Here’s the equation that explains both — and what the industry is finally starting to see.
Every industry conference, every analyst report, every vendor pitch deck includes a version of the same graphic: The Evolution of Procurement Technology.
You’ve seen it. Three eras, neatly delineated:
- First Procurement Apps (1990–2004): Commerce One, FreeMarkets, Ariba. Best-of-breed innovation. IPOs. The dotcom boom.
- Suites Era (2004–2017): SAP acquires Ariba. IBM acquires Emptoris. Consolidation. Unified S2P platforms. Enterprise scale.
- Emerging Tech Era (2017–Present): Coupa IPO. SoftBank investments. AI startups. API economy. Best-of-breed revival.
It’s an accurate history of what vendors built.
It’s an incomplete history of what customers experienced.
The Missing Column
What those timelines don’t recognize is the failure rate that accompanied each era:
Technology kept improving. The failure rate got worse.
That’s the question no one asks: If the technology kept getting better, why did the outcomes keep getting worse?
The Answer Is Mathematical
The failure rate persists because of a structural problem the industry hasn’t recognized. Here’s the equation:
S = R·A + (1−R)(1−W)·B
Where:
- R = Percentage of organizations that are truly ready (EEAC/HFS-qualified)
- A = Success rate when the organization is ready (≈90–95%)
- B = Success rate when the organization is unready (≈0–10%)
- W = Walk-away rate from unready buyers
The equation has two terms:
- R·A — Ready organizations succeeding at the HFS rate
- (1−R)(1−W)·B — Unready organizations that vendors didn’t walk away from, occasionally succeeding by luck
The Revenue Trap: W ≈ 0
Here’s the structural problem: Vendors are paid at contract signature.
Whether you succeed or fail is your problem. The vendor’s revenue is locked in the moment the deal closes. This creates zero economic incentive to walk away from unready buyers.
So the industry operates with W ≈ 0 — vendors sell to everyone.
When W = 0, the equation becomes:
S = R·A + (1−R)·B
Since unready organizations rarely succeed (B is very small), the second term contributes little to the overall success rate. Across a portfolio of implementations, the equation simplifies to:
S ≈ R·A
If only 20% of organizations are truly EEAC-ready (R = 0.20), and ready organizations succeed at 95% (A = 0.95), then:
The 80% failure rate emerges mathematically. It’s not bad technology. It’s not bad consultants. It’s the inevitable consequence of selling to everyone regardless of readiness.
The Revenue Trap Defined
The Revenue Trap: Vendors have no economic incentive to assess readiness because they get paid whether you succeed or fail. The failure term (1−R)(1−W)·B persists because W stays near zero.
This is why the failure rate hasn’t moved in four decades. The economic structure guarantees it.
Why The Failure Rate Worsened Across Eras
Each era added complexity without addressing readiness:
The technology demanded more organizational readiness with each wave. The industry invested nothing in building it.
- In 2015, 62% of CPOs said their teams lacked necessary skills
- Only 3.2% of organizations invested more than 1% of budgets in talent development
- By 2025, 85% of CIOs say their teams aren’t AI-ready
The denominator (required readiness) kept increasing. The numerator (actual readiness) stayed flat. The failure rate widened.
The Suites Era Trap
The Suites Era deserves special attention because it created the pattern we’re still living with:
“The Suites Era created systems known for complexity, steep learning curves, high TCO, and difficult integrations. This lack of usability forces users to avoid the system and retreat to spreadsheets.”
That’s not a technology failure. It’s an Absorptive Capacity failure.
Organizations couldn’t absorb what they bought. They didn’t have the governance, the skills, or the change velocity to operationalize unified S2P platforms. So they retreated to what required no organizational alignment: spreadsheets.
The technology worked. The organizations didn’t.
And nobody checked before the contract was signed.
What Happens When Walk-Away Discipline Increases
As W → 1 (vendors walk away from unready organizations), the failure term collapses:
(1−R)(1−W)·B → 0
But something more powerful happens. Inside the portfolio of accepted clients, R approaches 100% — because Phase 0 has filtered out the low-HFS buyers.
So the effective success rate within that portfolio becomes:
S_portfolio ≈ A ≈ 90–95%
Real-World Validation
Recently, a senior executive from a ProcureTech solution provider stated that their policy is to walk away aggressively from unready buyers. Earlier this year, they walked away from a multi-year contract with a client because Phase 0 indicators were failing — they couldn’t define “done,” rejected expertise, and used threats as a negotiating tactic.
His results over 12 years: ~95% success rate.
Sri Tella, a CIO, killed a $400K AI project this year because she asked the readiness questions no one else asked: What’s the actual cost of the problem? What’s the simplest fix? Are we solving the right problem?
She chose discipline over buzzwords. She chose Phase 0, thinking over the hype cycle.
The math predicts exactly what practitioners prove. High W → High success rate. It’s not intuition. It’s arithmetic.
The Market Correction Mechanism
Phase 0 is not just a diagnostic tool. It’s a market correction mechanism.
Without Phase 0: Everyone buys Ferraris while still learning to drive.
With Phase 0: Only qualified drivers get behind the wheel — and suddenly the crash rate disappears.
The Two Timelines
The next time you see an industry timeline celebrating 35 years of procurement technology innovation, ask:
Where’s the customer experience column?
The technology timeline shows what vendors built. The failure rate shows what customers experienced.
They’re both true. Only one gets shown at conferences.
The Industry Is Starting To See It
Gartner’s recent admission that 85% of CIOs don’t believe their teams are ready suggests the industry is beginning to recognize what these timelines have always missed.
They’re not hiding the failure rate. They haven’t had a framework to connect it to readiness.
Now they do.
The Bottom Line
The 80% failure rate isn’t a mystery. It’s mathematics.
S = R·A + (1−R)(1−W)·B
When vendors sell to everyone (W ≈ 0), failure is guaranteed for the unready majority.
When Phase 0 introduces walk-away discipline (W → 1 for unready buyers), success becomes the default — not the exception.
The equation doesn’t lie. The question is whether the industry is ready to recognize what it’s been missing for 35 years.
-30-
Procurement Insights
The History They Show vs. The History They Haven’t Recognized
Posted on December 11, 2025
0
35 years of ProcureTech timelines celebrate what vendors built. The failure rate reveals what customers experienced. Here’s the equation that explains both — and what the industry is finally starting to see.
Every industry conference, every analyst report, every vendor pitch deck includes a version of the same graphic: The Evolution of Procurement Technology.
You’ve seen it. Three eras, neatly delineated:
It’s an accurate history of what vendors built.
It’s an incomplete history of what customers experienced.
The Missing Column
What those timelines don’t recognize is the failure rate that accompanied each era:
Technology kept improving. The failure rate got worse.
That’s the question no one asks: If the technology kept getting better, why did the outcomes keep getting worse?
The Answer Is Mathematical
The failure rate persists because of a structural problem the industry hasn’t recognized. Here’s the equation:
S = R·A + (1−R)(1−W)·B
Where:
The equation has two terms:
The Revenue Trap: W ≈ 0
Here’s the structural problem: Vendors are paid at contract signature.
Whether you succeed or fail is your problem. The vendor’s revenue is locked in the moment the deal closes. This creates zero economic incentive to walk away from unready buyers.
So the industry operates with W ≈ 0 — vendors sell to everyone.
When W = 0, the equation becomes:
S = R·A + (1−R)·B
Since unready organizations rarely succeed (B is very small), the second term contributes little to the overall success rate. Across a portfolio of implementations, the equation simplifies to:
S ≈ R·A
If only 20% of organizations are truly EEAC-ready (R = 0.20), and ready organizations succeed at 95% (A = 0.95), then:
The 80% failure rate emerges mathematically. It’s not bad technology. It’s not bad consultants. It’s the inevitable consequence of selling to everyone regardless of readiness.
The Revenue Trap Defined
This is why the failure rate hasn’t moved in four decades. The economic structure guarantees it.
Why The Failure Rate Worsened Across Eras
Each era added complexity without addressing readiness:
The technology demanded more organizational readiness with each wave. The industry invested nothing in building it.
The denominator (required readiness) kept increasing. The numerator (actual readiness) stayed flat. The failure rate widened.
The Suites Era Trap
The Suites Era deserves special attention because it created the pattern we’re still living with:
That’s not a technology failure. It’s an Absorptive Capacity failure.
Organizations couldn’t absorb what they bought. They didn’t have the governance, the skills, or the change velocity to operationalize unified S2P platforms. So they retreated to what required no organizational alignment: spreadsheets.
The technology worked. The organizations didn’t.
And nobody checked before the contract was signed.
What Happens When Walk-Away Discipline Increases
As W → 1 (vendors walk away from unready organizations), the failure term collapses:
(1−R)(1−W)·B → 0
But something more powerful happens. Inside the portfolio of accepted clients, R approaches 100% — because Phase 0 has filtered out the low-HFS buyers.
So the effective success rate within that portfolio becomes:
S_portfolio ≈ A ≈ 90–95%
Real-World Validation
Recently, a senior executive from a ProcureTech solution provider stated that their policy is to walk away aggressively from unready buyers. Earlier this year, they walked away from a multi-year contract with a client because Phase 0 indicators were failing — they couldn’t define “done,” rejected expertise, and used threats as a negotiating tactic.
His results over 12 years: ~95% success rate.
Sri Tella, a CIO, killed a $400K AI project this year because she asked the readiness questions no one else asked: What’s the actual cost of the problem? What’s the simplest fix? Are we solving the right problem?
She chose discipline over buzzwords. She chose Phase 0, thinking over the hype cycle.
The math predicts exactly what practitioners prove. High W → High success rate. It’s not intuition. It’s arithmetic.
The Market Correction Mechanism
Phase 0 is not just a diagnostic tool. It’s a market correction mechanism.
Without Phase 0: Everyone buys Ferraris while still learning to drive.
With Phase 0: Only qualified drivers get behind the wheel — and suddenly the crash rate disappears.
The Two Timelines
The next time you see an industry timeline celebrating 35 years of procurement technology innovation, ask:
Where’s the customer experience column?
The technology timeline shows what vendors built. The failure rate shows what customers experienced.
They’re both true. Only one gets shown at conferences.
The Industry Is Starting To See It
Gartner’s recent admission that 85% of CIOs don’t believe their teams are ready suggests the industry is beginning to recognize what these timelines have always missed.
They’re not hiding the failure rate. They haven’t had a framework to connect it to readiness.
Now they do.
The Bottom Line
The 80% failure rate isn’t a mystery. It’s mathematics.
S = R·A + (1−R)(1−W)·B
When vendors sell to everyone (W ≈ 0), failure is guaranteed for the unready majority.
When Phase 0 introduces walk-away discipline (W → 1 for unready buyers), success becomes the default — not the exception.
The equation doesn’t lie. The question is whether the industry is ready to recognize what it’s been missing for 35 years.
-30-
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